tv Your Bottom Line CNN August 4, 2012 9:30am-10:00am EDT
but they're also going to say to themselves, when does he become responsible for the economy? is it one year in? two yeergs in? we've heard him say he inherited this mess at some point he has to take responsibility for it and that's what the republicans are trying to attach to him now. >> mitt romney is claiming he can create 12 million jobs over the next four years if he is president. that has happened before, from 1996 to 1999. millions of jobs were created. how do you create 12 million jobs over four years. is it possible? >> it's possible but it's not probable in this current economic environment when you come out of the economic crisis. the kicking the can down the road on the fiscal cliff and having that hanging over our heads. there could be a down grade in our debt which would have long-term repercussions and stifle growth over the long
haul. if there is a silver bullet to be shot, it would have been shot already. >> in economics we want numbers, we want statistics. and when you are in the middle of an election year, people look at the numbers like this. will it make them feel better about their personal what they saw this month? >> first of all, some of the data was skewed. the manufacturing data was skewed by the fact that the auto makers didn't shut down like they usually do and the auto sales haven't been that great. more of those leisure and hospitality jobs were in accommodations and eateries. the rest of them declines people aren't doing cultural stuff. but they are taking some discretionary vacations. but there aren't things of increased hours work. and the unemployment rate when you broke that down, that was a nasty report. so at the end of the day, the measure of our misery is the reality of 8.3% of the unemployment rate. it's the reality that we've had
people that are getting marginalized more and more in a cumulative way. you can blame one party or the other, we got into this together. we need to get out of it together. >> peter, i want to focus on something that diane just pointed out that 20,000 manufacturing jobs add the. there's this popular narrative there's this manufacturing comeback in the united states. diane pointed out it may have been fewer temporary layoffs in the auto industry. what do you make of that? >> well, 25,000 new manufacturing jobs pales in comparison to the 6 million manufacturing jobs we've lost to china in the last ten years. the thing about manufacturing jobs is that they have the best multiplier for new jobs. if you have one manufacturing job, you get four more in services. so if we lose 6 million manufacturing jobsz to china, that's 24 million jobs that we've lost over the decade and that's the problem here. if you look at the numbers, we have to create 300,000 jobs a
month for two years just to drive that unemployment rate from 8% down to 5%. and the silver bullet here really, and what the politicians don't seem to understand, the silver bullet is getting our manufacturing jobs back on shore. apple, boeing, cater pillar, they need to produce here in america and they can't do that as long as our biggest trading partner cheats. and i think we're fooling ourselves here in this country if we think the problem only dates back to 2007. as a practical matter, for the last ten years, we've grown at an annual rate of 1.6% gdp. 5 1/2 decades prior to that, we drew at 3.5% gdp. one point is one million jobs created a year. so if we're losing 2% gdp points
a year, that's 2 million jobs. >> listen to you talk about the last 20 years and using a wide perspective. this is politics, right? in washington people think in quarters in election years. >> more importantly, the corporate types do. i think you're right. the candidate who's going to win in november is the candidate who takes this message to ohio and pennsylvania and michigan. the best jobs program is trade reform with china. >> i'm not hearing much about trade reform on the campaign trail. hold your thought. we have to pay the bills for two minutes and i want to talk more. up next, if a third of american's jobs, what happens to the middle class and which candidate has the policies to fix it.
police, i return home to iowa to see the drought damage for myself. it's devastating crops, particularly corn and the reason you'll be paying more for your groceries next year. [ female announcer ] e-trade was founded on the simple belief that bringing you better technology helps make you a better investor. with our revolutionary e-trade 360 dashboard you see exactly where your money is and what it's doing live. our e-trade pro platform offers powerful functionality that's still so usable you'll actually use it. and our mobile apps are the ultimate in wherever whenever investing. no matter what kind of investor you are, you'll find the technology to help you become a better one at e-trade.
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by the year 2020, almost a third of all american jobs will be low wage, low paying jobs. peter navarro, can the middle class maintain the standard of living the way things are going right now? >> absolutely not. if you look at germany, 25% of their work force is in manufacturing. here in america it's down to 9%. we simply cannot generate a decent standard of living at a
3.5% gdp growth rate per year unless we have manufacturing. i'm talking about things like making automobiles and aircraft and sophisticated medical equipment. we can do this here. but the problem we face in this country is that our biggest trading partner not only cheats in terms of illegal subsidies and currency manipulation, it protects its own markets. the idea was, oh, great, they've got 1.3 billion people. the fact of the matter is the chinese won't let us into their markets unless we surrender our technology. this is a structural problem we've had for ten years now, i'd love to hear the white house, mitt romney, congressional leaders start talking about the best jobs program is trade reform with china. >> let's bring diane in your 'from detroit? >> this is been going on since the early 80s.
we had output increase and we're seeing onshore now because of some of the things peter talked about. china cheats. people don't like it when they set up a manufacturing plant and in the next six months they set up a plant wages are going up in china. all the things that are equalizers are now starting to repel people. we're starting to sell cars in china. >> is it enough to make a dent in the 6 million jobs that have gone. >> the 6 million jobs that have gone for several reasons. first of all it was japan and then honda set up in 1982 a plant in ohio. we've got foreign manufacturers setting up plants. we're getting proficient at production and where the job shortages are the 18-month licensing degrees, the jobs we never thought would exist in manufacturing again. >> tell me about those jobs. when i talk to ceos who work in those industries, they tell me
they can't find american workers who can do the jobs. what do you want? how can there be 13 million out of work but nobody has any workers. >> it is interesting, because the ceos did not have to pay for education for a long time. we had an educational system that trained people to work in factors and now they have to think. we are seeing partnership going on. and those actually are working and those people are getting jobs. they're getting multiple job offers. the hit rate is high. boeing is training people, six-figure jobs to work only on their equipment. it's a good job. >> mark, for the politics of this, this doesn't translate on the campaign trail, does it? you don't hear this language about how you're going to handle trade issues? >> no. because it's not sexy enough what you ril hear, certainly mitt romney has said he's going to be harder on china and sit
down at the table with them and tell them that they have to work better with us. but be beyond that, people don't want to hear the bullet points because bottom line they're trying to pay their mortgage and put their kids through school, save their jobs they want washington to work correctly. they want president obama or romney to deliver on the promis promises. but when we talk about the unemployment rate, 8.3%, it's very important. but the bottom line, this is going to come down to swing states. the unem plament rate when we get those numbers, what is it in ohio, nevada, florida because those are the key states that are going to decide who wins the election. >> in several states it is lower now than when the president took office. peter, mark, diane, thanks everybody. have a great weekend. farmers in the heartland are waiting for rain. rain that won't come. i'll tell you how drought in the
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you'll be paying more for your groceries next year. that's because the worst drought in 50 years is causing irreparable damage to crops and driving prices higher. more than 60% of the continental united states is experiencing some form of drought and experts say it's getting worse. the price of eggs will rise between 3% and 3%. and you will pay pour mor vegetables. it threatens our energy supply as well. water shortages are forcing cutbacks in oil and natural gas production. nuclear power plants which rely
on water for cooling reduced their output. and with nearly 90% of corn hit by drought. ethanol prices up 30%. the united states produces 38% of the world's corn and iowa produces more corn than any other state. i returned to iowa to see the damage itself. and talk to them about what it means for their farm and future. what they need more than anything else in iowa right now, rain. >> reporter: what are the things that farmers talk about? >> will it rain. did you get any rain? who got rin. >> last week it was 105 degrees. you can see there's not much there the plant move the nutrients up and in to get the water up and in. >> when it's 100 degrees, that just pretty much fries all this stuff. >> it tried. >> reporter: this is, for some
farmers, they've never seen in the field this many poor ears right in a row. >> probably not, not in the last 20 years. >> i'm going to be honest with you, one time in my life i think i saw a field like this, and that will be '88. do you think farmers are more prepared after '88? do you think more have insurance now? >> absolutely. in '88, we didn't have insurance, so we had to suck it up, really, and the government had a disaster program, and they tried helping us out. they required us, if we were going to be in the farm program, that we had to buy insurance so that we would protect ourselves. >> so, to figure out if it's po pollina pollinated, you can shake it like this and you can see how many are attached and those kernels will probably abort. >> my father farmed his entire life, my grandfather farmed his entire life. this is done. >> reporter: this is done? if it rains, it wouldn't help? >> it wouldn't be doing any good. >> reporter: so you've sort of surrendered. the corn should be lush and tall and green in the fields.
instead, this is a cornfield, a dry, almost worthless cornfield. this farmer's decided to just plow over it, chop it up and feed it to his animals. this is basically start of the harvest, the harvest that many thought this year would be great. instead, at least in this case, it will be a bust. >> this is just junk. >> reporter: so, in this junk is seed cost, labor cost -- >> yeah. >> reporter: -- land cost, insurance cost. >> yeah, they don't ever -- >> reporter: spray costs. >> -- seem to stop the expenses from coming. >> reporter: they keep sending you a bill, but it's never going to send you a check. >> exactly. last year's corn is here. >> there she is, right here. >> this year's corn is not going to look as pretty. it's not going to be as dense of the one, two, three, four, five, six bins i have, i think this one will hold my whole crop. i've done pretty much all i can do for this crop, and we've just got to hope mother nature stabilizes what we have left. >> we'll get by, hopefully, and it is what it is, try again next year.
we only get one chance a year, so, try again next year. coming up, he started out walking behind a team of horses cultivating corn. today the farming is more high-tech, but the droughts are just as devastating. >> real bad. >> reporter: and it was bad in '56, it was bad in '88, some bad patches in 2005. >> but they weren't as bad like it is this year. this year it's worse. >> when we come back, you'll hear from the people hit hardest. oney. i'm not taking your money. besides i get great gas mileage. what's that? it's eassist. helps the engine run really efficiently. it captures energy that assists the engine... so i'm never guzzling gas. oh -- that's hippie talk. it's called technology dad... here take two dollars. take the money. [ male announcer ] the all new 37 mpg highway chevy malibu eco. from conserving fuel, to the technology that makes it happen. chevy runs deep.
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it into ethanol to blend with gasoline and drive our cars. but farmers are getting older and family farms are shutting down, and now a worsening drought will shrink supplies of a very valuable commodity. here in my hometown of eau claire, iowa, as long as anyone can remember, argo general store has been where farmers gather to talk about their crops. the people you see here have been regulars for decades. today, they're grim but resilient about what is already an historic drought, and they are praying for rain. >> good morning, gary! >> good morning. >> how are you this morning, sir? >> good. >> reporter: hi. i'm christine romans, nice to meet you. my name is christine. >> this man is going to tell you just how bad it is. >> reporter: how many years did you farm? >> all my life. >> reporter: all your life. >> yep. >> reporter: so, when did you start? >> that's all i've ever done. huh? >> reporter: when did you start farming? >> i started on my own in '44. >> reporter: '44. so you've seen some beautiful crops and you've seen some
really terrible crops. >> this is one of the years it's a bad crop. this is about as bad as it was in '36. >> reporter: in '36. >> in '36 it was real bad. >> wow. and it was bad in '56 it was bad in '88 there were some bad patches in 2005. >> yeah, but they weren't as bad like it is this year. this year i think is worse. >> reporter: farming, has it changed a lot since when you started? >> oh, you talk about changed a lot, i walked behind a team of horses culminating the farm. now they don't even culinate it. last time, we had 18,000 or 20,000 plants to the acre. now they plant 35,000, 38,000 plots per acre. >> reporter: wow! what's an acre of farmland around here, i mean, like -- >> about ten. >> reporter: $10,000 an acre, which is tough if you're trying to buy a farm, you know? >> well, unless you're harry. >> reporter: unless you're harry. >> oh, that's not --
>> reporter: coffee's on harry this morning, everyone. >> yeah, you get coffee out of harry, you're going to be doing something. [ laughter ] >> this is an aerial photo of harry's place. see all them little white dots? >> reporter: yeah. >> well, that's where all of his cans of money are buried. >> reporter: that's what it says! harry's coffee milk can barrel plot map. oh, you guys are funny. tell me about what you see when you look at those fields. >> it's not good. we're probably only going to get to the combine, but there was corn on the corn the last four years. this is not very good. we need some rain, rain bad. hopefully, we can save some beans. >> it looked good, real good early, and now it just kind of worse and worse and worse. we're going to have some pretty decent corn, but most of it's not going to be very good. there's going to be spots on everything, i believe. >> reporter: this is as bad as '88? >> i think a little worse. it started earlier. in '88, it kind of got later and dried up. >> we'll make it. went through good times, bad
times, but farming is a great life. lots of you are asking me about america's ethanol policy. why are we using corn for fuel when corn prices are rising and we need corn to feed animals and people around the world? i want to know what you think about that. you can find me on facebook and twitter, @cnnbottomline and @christineromans. more video and interviews on our blog, cnn.com/bottomline. now back to "cnn saturday" for the latest headlines. the latest headlines. have a great weekend. -- captions by vitac -- www.vitac.com we might be number one here, but we're nowhere close here. all morning, we're putting education in focus. why in the world is our system ranked lower than ireland, saudi arabia and uzbekistan? and later, save a life, get a bill. why one brave teen was charged for doing the right thing. and later, a woman changing
lives and saving lives one child at a time, rescuing them from the war zone. i'll talk with her and the first boy she saved. happy saturday, everybody. i'm randi kaye. it's 10:00 on the east coast, 7:00 a.m. on the west. thanks for starting your day with us. we start with wildfires tearing through oklahoma towns. this is new video of the devastation. take a look. the fire is moving quickly, thanks to dry brush and strong win winds. so far, dozens of structures have been burned, but there are hundreds more homes that are threatened this morning. one of the worst of the fires burning right now is in luther, oklahoma. investigators there are looking into the possibility that the fire was deliberately set by a man allegedly throwing burning wads of paper into a pasture. more extreme weather now and tropical storm ernesto is moving
west toward jamaica. people in southern jamaica are being warned that the storm is coming. it already swept past the windward islands with heavy rain and 60-mile-per-hour winds. ernesto is expected to strengthen into a hurricane some time tomorrow, but the latest tracks don't have it reaching the u.s. and right behind ernesto is a brand-new named storm, tropical storm florence with winds at 40 miles per hour. relatives of former penn state coach joe paterno are fighting for the school and his legacy. paterno's family says they plan to appeal the ncaa's sanctions against the university, but -- and this is a big but -- an ncaa spokesman says those sanctions are not subject to appeal. last month, the ncaa stripped 14 seasons of football victories from the late paterno in addition to leveling a $60 million fine against the university. it is all over a fallout from the child sex abuse scandal involving former coach jerry sandusky. to politics nowd